How do I end a business partnership?
Business partnerships can fail for many reasons. Perhaps you and your partner no longer agree on the direction of the business or personal problems are affecting your partner’s work ethics. No matter what the reason for the business strife, there are ways to dissolve a partnership in a
Review Your Business Partnership Agreement
Hopefully, you and your partner entered into the business arrangement with a
Many partnership agreements will contain a clause much like a prenuptial agreement. The dissolution clause will set out what is to happen to the business if the partnership reaches a point that it can no longer continue. Your contract could call for the sale of the business and division of its assets or may allow one partner to continue operations while buying out the other partner. Have your attorney review your partnership agreement if you wish to dissolve the relationship.
Resolve the Dispute With Mediation
If you do not have a partnership agreement, you will want to attempt to work on the terms of the dissolution with your partner. An agreement between the two of you will be the quickest and easiest way to resolve the dispute. Your business formation attorney can help you enter into discussions so that you know your legal rights.
Alternatively, you can enter into mediation with your partner. A mediator is a neutral third party who will help you, your partner, and your attorneys to reach a fair dissolution compromise. Mediation is relatively inexpensive and at times just one or two sessions can effectively resolve the matter.
Where no agreement can be reached, you will need to proceed to court. Litigating the breakup of your partnership can be complicated and costly. You will want to retain the assistance of an experienced business law attorney to assist you in the process.